The Mecca Café managed to survive the Depression even though it opened shortly after the country's first financial meltdown in 1929. The bar and restaurant in Lower Queen Anne has also managed to keep plugging away even after the Seattle Supersonics left town and eliminated a customer base that used to pack the place before and after games at the KeyArena.
But the end may be near for a neighborhood institution that has played home to both the famous and infamous over the years. As noted in last week's News, Mecca manager Karon Hanke blames the Bank of America.
The problem, she said, is that the bank has eliminated the business' line of credit and written off approximately $39,000 still owed on the account. That, in turn, has ruined the bar's credit rating and made it impossible to get another line of credit, Hanke said of a fundamental business tool.
B of A spokeswoman Brittney Sheehan said bank officials are still looking into the Mecca situation, and she cautioned that customer-privacy concerns would prevent her from discussing many details. But Sheehan did have some bottom-line information. "The sole guarantor on that line of credit is deceased," she said.
That would be Mecca owner Dick Smith, who passed away in October 2001, Hanke said.
But the bank has no documentation about the executor of Smith's estate, which "would have allowed that person fiduciary control of the café," Sheehan said. "The account was blocked shortly after the guarantor's passing," she added.
Hanke begs to differ. When Smith died, there was around a $49,000 balance on the line of credit, she explained, adding that she was hired on as manager three years later. The balance on the line of credit was paid off in full by September 2005, and the line of credit was restored to $50,000, Hanke said.
"I did not use it again until January 2006," she said of the account. The Mecca needed the money for a beer cooler, to fix the neon signs, for new surveillance cameras, for some quarterly taxes and for business operating expenses, Hanke said.
And while one payment was late and one payment was for less than the full amount, the Mecca continued to pay off the loan, she said. However, the bar's financial standing went south last April when Hanke got a bombshell call from a B of A representative, she said.
"He told me they were going to freeze the line of credit because it was in default and delinquent," Hanke said. The bank representative also demanded that the Mecca make $1,700-a-month payments to catch up, something the bar couldn't afford, she said.
Still, Hanke continued to make monthly payments of $500, and $1,000 when the bar could afford it, she said. "The next thing I knew, it was charged off," she said of the account.
Hanke said she was also told the credit bureaus were notified about the write-off. "Now I can't go anywhere and get a loan." In fact, she recently lent the Mecca $6,000 of her own money to keep it open, Hanke said.
Smith's widow, Darlene Smith, is heir to half of the Mecca while a trust owns the other half, Hanke said. Darlene tried to get the line of credit transferred to her name last August, Hanke said. "They denied her."
Bank spokeswoman Sheehan is sympathetic. "While she may want to do the right thing," Sheehan said of the Mecca manager, "she may not have the legal authority."
The Bank of America plans to reach out to Darlene Smith to find out what she thinks can be done to fix the problem, Sheehan added. "I can assure you," she told this reporter, "we're on top of this."
Hanke, meanwhile, is steamed about the line of credit. "I didn't know I couldn't use it," she railed. "The thing is, if I don't get a line of credit, I'll have to close," Hanke lamented. "I have no money to fall back on."
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